NATIONAL ANTHEM
BANGLADESH

My Bengal of gold, I love you
Forever your skies,
your air set my heart in tune
as if it were a flute,
In Spring, Oh mother mine,
the fragrance from
your mango-groves makes me
wild with joy-
Ah, what a thrill!
In Autumn, Oh mother mine,
in the full-blossomed paddy fields,
I have seen spread
all over - sweet smiles!
Ah, what a beauty, what shades,
what an affection
and what a tenderness!
What a quilt have you spread
at the feet of banyan trees and
along the banks of rivers!
Oh mother mine,
words from your lips are like
Nectar to my ears!
Ah, what a thrill!
If sadness,
Oh mother mine,
casts a gloom on your face,
my eyes are filled with tears!


Original in Bangla by
Rabindranath Tagore
translated by
Professor Syed Ali Ahsan



  Quick Tour  

 
  Trade and Investment Opportunities  
     
 
INVESTMENT CLIMATE

Bangladesh offers an unparalleled investment climate compared to the other South Asian economies.
  • Bangladesh is a largely homogenous society with no major internal or external tensions and a population with great resilience in the face of adversity (e.g. natural calamities). Bangladesh is a liberal democracy and mostly a one race and one religion country. The population of this country irrespective of race or religion have been living in total harmony and understanding for thousands of years.
  • Broad non-partisan political support for market oriented reform and the most investor-friendly regulatory regime in south Asia.
  • Trainable, enthusiastic, hardworking and low-cost (even by regional standards) labor force suitable for any laborintensive industry.
  • Geographic location of the country is ideal for global trades with very convenient access to international sea and air route.
  • Bangladesh is endowed with abundant supply of natural gas, water and its soil is very fertile.
  • Although Bengali is the official language, but English is generally used as second language. Majority of even moderately educated population can read, write and
    speak in English.
  • There exists a middle class with purchasing power. As economic growth picks up, the purchasing power is growing substantially. And in a country of more than 130 million people, even a small middle class may constitute a significant market. Furthermore, Bangladesh products enjoy duty free and quota free access to almost all the developed countries. This access to the global market is further helped by the fact that policy regime of Bangladesh for foreign direct investment by far the best in South Asia.
  • Most Bangladeshi products enjoy complete duty and quota free access to EU, Japan, USA, Australia and most of the developed countries.

INVESTMENT INCENTIVES

The democratic government is highly keen to stimulate the economy and transform a poverty-stricken economy to NIE within short time. Government has liberalized the industrial and investment policies in recent years by reducing bureaucratic control over private investment and opening up many areas. Major incentives are as follows:
  1. Tax Exemptions : Generally 5 to 7 years. However, for power generation exemption is allowed for 15 years.
  2. Duty : No import duty for export oriented industry. For other industry it is @ 5% ad valorem..
  3. Tax Law : Double taxation can be avoided in case of foreign investors on the basis of bilateral agreements.ii. Exemption of income tax up to 3 years for the expatriate employees in industries specified in the relevant schedule of Income Tax ordinance.
  4. Remittance : Facilities for full repatriation of invested capital profit and divided.
  5. Exit : An investor can wind up on investment either through a decision of the AGM or EGM. Once a foreign investor completes the formalities to exit the country, he or she can repatriate the sales proceeds after securing proper authorization from the Central Bank.
  6. Ownership : Foreign investor can set up ventures either wholly owned on in joint collaboration with local partner.
Other Incentives
  • Tax exemption on royalties, technical know-how fees received by any
    foreign collaborator, firm, company and expert.
  • Tax exemption on the interest on foreign loans under certain conditions.
  • Avoidance of double taxation in case of foreign investors on the basis of
    bilateral agreements.
  • Exemption of income tax up to 3 years for the foreign technicians
    employed in industries specified in the relevant schedule of income tax
    ordinance.
  • Tax exemption on income of the private sector power generation company
    for 15 years from the date of commercial production.
  • Facilities for full repatriation of invested capital, profit & dividend.
  • 6 months multiple entry visa for the prospective new investors.
  • Re-investment of repatriable dividend treated as new investment.
  • Citizenship by investing a minimum of US$ 5,00,000 or by transferring
    US$ 10,00,000 to any recognized financial institution (non-repatriable).
  • Permanent residentship by investing a minimum of US$ 75,000 (nonrepatriable).
  • Tax exemption on capital gains from the transfer of shares of public limited companies listed with a stock exchange.
  • Special facilities and venture capital support will be provided to export-oriented industries under “Thrust sectors”
    There will be no discrimination in case of duties and taxes for the same type of industries set up by foreign and local investors and in the public and private sectors.
 



Chittagong Port

Incentives to Export-Oriented and Export-Linkage Industries

Export-oriented industrialization is one of the major objectives of the Industrial Policy. Export-oriented industries will be given priority and public policy support will be ensured in this respect. An industry exporting at least 80% of its manufactured goods or an industry contributing at least 80% of its products as an input to finished
exportables, and similarly, a business entity exporting at least 80% of services
including information technology related products will be considered as an export-oriented industry. To make investment in 100 percent export-oriented industries attractive, the following incentives and facilities will be provided

  • Duty free import of capital machinery and spare parts up to 10 percent of the value of such capital machinery will continue.
  • Existing facilities for Bonded Warehouse and back-to-back Letter of Credit will continue.
  • The system for duty drawback will be further simplified and to this end, duty drawback will be fixed at a flat rate on exportable and potentially exportable goods. Exporter will receive duty drawback at a flat rate directly from the relevant commercial banks.
  • The arrangement for providing loans up to 90 percent of the value against irrevocable and confirmed Letter of Credit/Sales Agreement will continue.
  • To ensure backward linkage, incentives will be extended to the “deemed exporters” supplying indigenous raw materials to export-oriented industries. Export-oriented industries including export-oriented RMG industries, using indigenous raw materials will be given facilities and benefits at prescribed rates.
  • The export-oriented industr4ies, further to the provisions of Bangladesh Bank foreign exchange regulations, will be entitled to receive additional foreign exchange, on case to case basis, for publicity campaign, opening overseas offices and participating in international trade fairs.
    g. The entire export earning from handicrafts and cottage industries will be exempted from income tax. For all other industries, income tax rebate on export earning will be given at 50 percent.
  • The facility for importing raw materials, which are included in the banned/restricted list, but required in the manufacture of exportable commodities, will continue.
  • The import of specified quantities of duty-free samples for manufacturing exportable products will be allowed consistent with the prevailing relevant government policy.
  • The local products supplied to local industries or projects against foreign exchange L/C will be treated as indirect exports and be entitled to all export facilities.
  • The Export Credit Guarantee Scheme will be further expanded and strengthened.
  • 10 percent products of the enterprises, located in both public and private EPZs will be allowed to be exported to domestic tariff area against foreign currency L/C on payment of applicable duties and taxes.
  • 100% percent export-oriented industry outside EPZ will be allowed to sell 20% percent of their products in the domestic market on payment of applicable duties and taxes.



A cement Factory

COMPETITIVE SECTORS FOR INVESTMENT:

TEXTILE:
Sector Highlights:
 The Ready Made Garment Industry in Bangladesh accounts for more than 75% of total exports.
 Bangladesh is best placed in the region for textiles and garments because of low-cost labor, preferential trade status and advantageous global market access.
 Government incentives for the spinning and weaving industries include a 15% cash subsidy of the fabric cost to exporters sourcing fabrics locally.
 There is a huge fabric demand supply gap in the RMG industry which is being met by imports. Thus, the potential for backward linkage industry is enormous

Industry Background and Status:
The Phenomenal growth in RMG was experienced in the last decade. With about 2,600 factories and a workforce of 1.4 million, RMG jointly with knitwear accounted for more than 70% of total investments in the manufacturing sector during the first half of the 1990’s. At present, number of RMG factories exceeded 3,000 employing over 50% of the industrial workforce and having 75% of the total exports earning of the country.

Investment Opportunities:

RMG and textile sectors have enormous investment opportunities. Government provides highly favourable policy framework for investment in these sectors. Investors has the following choices:
 Establishment of new textile/RMG mill in the private sector.
 Joint Ventures with the existing textile/RMG mill.
 Acquisition of public sector textile mills that are being privatized.
 Indirect investment through financial services and/or leasing.

FROZEN FOODS:
Sector Highlights:
 Government is promoting semi-intensive shrimp farming.
 Fish and prawn exports registered a modest growth in the past decade.
 Shrimp processing and export industry is largely dominated by the smaller unorganized sector.
 15% cash incentive is given to shrimp export amount. Industry Situation: The frozen foods export is the second largest export sector of the country. After some initial difficulties in terms of quality achievement, exporters have earned credibility and trustworthiness in the global market. Assurance of reliable and continued product quality is a major challenge in this sector. Technology orientation, marketing perceptions, and quality improvement aspects invite foreign investment in this sector.

Industry outlook:
Frozen food sub-sector has credible opportunities in Middle East, EU and North American countries. This export oriented industry includes the following sub-sectors, which need proper attention for augmentation of production and export earnings.
 Hatcheries
 Sustainable aqua-culture technology
 Feed meals plants
 Processing unit for value-added products. Investment in frozen food sector with new technology and equipment has a vast potential for growth.

LEATHER:
Sector Highlights:
 The labor intensive lather industry is well suited to Bangladesh having low cost and abundant labor.
 Bangladesh has a domestic supply of good quality raw material, as hides and skins are a by product of large livestock industry.
 Adequate government support in the form of tax holidays, duty free imports of raw materials and machinery for export-oriented leather market
 The industry lacks domestic technology and expertise and local support industries such as chemicals are still under-developed.
 Present Government is in the process of setting up of separate Leather Park relocating the existing industry sites to a well-organized place.
 Leather exporters have been given 15% duty drawback of cash incentive.

Industry Situation:
Bangladesh leather industry is dominated substantially by the domestic investment which are mostly export-oriented. The leather includes some ready-made garments, although that aspect is continued mainly to a small export-trade in “Italian-Make” garments for the US market. Footwear is more important in terms of value addition. This is the fast growing sector for leather products. Presently Bangladesh produces between 2 and 3 percent of the world’s leather market. Most of the livestock base for this production is domestic which is estimated as comprising 1.8 percent of the world’s cattle stock and 3.7 percent of the goat stock. Having the basic raw materials for leather goods as well as for the production of leather shoe, a large pool
of low cost but trainable labor force together with tariff concession facility to major importing countries under GSP coverage. Bangladesh can be a potential off shore location for leather and leather products manufacturing with low cost but high quality.

 

COMPETITIVE SECTORS FOR INVESTMENT

ELECTRONICS:
Home Appliances, Telecommunication Equipment, Semi-Conductor Sector Highlights:
 Rapid urbanization, migrations to urban centers and emergence of a consuming middle class have resulted in a modest growth in home appliance usage in Bangladesh.
 Global market of semi-conductor amounting about US$200 million is clearly dominated by the Asian NIEs.
 Manufacturing of semi-conductors could be established as a potential cottage industry.
 Since 1996, phenomenal growth in cellular phone usage in Bangladesh has been registered and today, the number of customers reached at nearly two million.
The labor intensiveness nature of electronic industry highly matches with the Bangladesh’s competitiveness and invites foreign investment in this sector.


Industry Background:
The electronics industry in Bangladesh mostly produces consumer items. Home appliances like television, radio, VCD and CD players, refrigerator, air conditioners, oven, electronic fan, blendes etc. are being assembled to a large extent. To ensurethe performance reliability, the key challenges in this sector are technical assistance and proper technology orientation of the
industry. Developing the significant capacity and skill in assembly and manufacture of a wide range of electronic components and parts is crucial.

AGRO-BASED INDUSTRY
Fresh Fruits & Vegetables; Cooked/Semi Cooked Food Items; Canned Juice; Dairy and Poultry; Livestock and Fisheries. Sector Highlights:
 Bangladesh has a huge supply of raw materials for the agro-based industry.
 Fruits and vegetable production has increased significantly in recent years.
 Government and NGOs have been conducting regular training programs in developing a skilled manpower for agro-based industry.
 There is a substantial demand supply gap in the agro-based industryboth in the domestic and international market.

Industry Incentives:
1. Specially arranged Equity entrepreneurship Fudn for development of agro- based industry.
2. Special loan facilities available to set up an agro-based industry.
3. Agro-based industry enjoys tax holiday.
4. Any investment in this sector will enjoy similar tax amnesty as available in other sectors.
5. Imposition of supplementary duty on mango, orange, grape, apples, dates and other to utilize the high quality and cheaper local resources.
6. Cash incentive to the exporters ranges from 15% to 20% in various sub-sectors.


INFORMATION TECHNOLOGY
Data Processing; software Development; Hardware Manufacturing.
Sector Highlights:
 To instigate the IT industry robustly, deregulation of the telephone has been decided and be executed by mid 2003.
 The extensive growth of mobile telephony resulted in significant opportunities.
 The industry is at its introductory stage and has opportunity of capitalizing the potential.
 Bangladesh has a well-educated, skilled, dedicated and growing IT workforce.
 There is a fast growing domestic market and export demand.
 Strong research assistance from the universities and research institutions are available.
 Government is keen in establishing IT related infrastructure for the development of the industry.
Industry Incentive:
 IT is declared as of the thrust sector for development. Soft loan facilities from the Equity and Entrepreneurship Fund is available.
 Tax holiday for software and IT services companies.
 All other facilities and incentives applicable in general to a foreign investor.

Industry outlook:
Formalization of VOIP by the early 2003 and telecom deregulation in mid 2003 would boost the overall IT sector lucrative for investment. Foreign investors from Asian, European and North American Countries could avail these opportunities. A number of Bangladeshi IT firms are interested in finding international investors or joint venture partners in various sub-sectors.

CERAMIC
Tableware; Sanitary ware; Insulator.
Sector Highlights:
 Global market of ceramic tableware is about US$10 billion.
 Bangladesh Ceramic tableware has a good reputation to the international market like North America and EU countries.
 Bangladesh has achieved technical expertise on ceramic tableware manufacturing.
 Historically, tableware industry is labor-intensive and Bangladesh has a skilled manpower in ceramic industry.
 Sanitary ware and insulator has also a domestic and international market demand.
 The clean gas reserve required for firing is a great competitive advantage for Bangladesh.
Industry Outlook: Global ceramic tableware industry is currently going through a phase of
acquisition and consolidation as smaller industries in the developed countries are becoming uncompetitive and bankrupt. As a result, the big names like Noritake, Wedgewood, Lenox, Villeroy & Boch and Royal Doulton are all individually becoming billion-dollar operations.
Historically, tableware industry is labor-intensive and even after spending billions of dollars on automation, developed countries could not reduce the number of workforce according to their expectations. As a result, the cost of production will always remain extremely high in developed countries and the premium brands are only surviving because they are charging huge price to the consumers for their brand equity.


LIGHT ENGINEERING
Machinery Parts; Bicycle; Other Consumer Items.
Sector Highlights:
 Bangladesh has about 40,000- small-scale light engineering enterprises spread over the country.
 Current light engineering industry manufactures about 10,000 types of items for the local industry amounting and annual value of approximately US$120 million.
 As the demand and usage of engineering and electronic goods increase,demand for light engineering products are also increasing.
 There is a significant number of cottage industries engaged in production of simple electronic goods.
 Government provides cash incentive facilities to exporters of value-added light engineering products.

NATURAL GAS-BASED INDUSTRIES
Electricity; Fertilizer; Petrochemicals; CNG Distribution Network. Sector Highlights:
 Bangladesh has net recoverable gas reserve of approximately 16 TCF and undiscovered reserve of approximately 32 TCF.
 Joint venture opportunities between BPDB and private sector are open.
 There is a huge demand for fertilizer in Bangladesh as the agriculture is the principal sector of the economy.
 Usage of indigenous resources and conservation of environment are important policy concerns of the Government.
 Introduction of CNG fuelling in the metropolises has geared the need for establishment of sufficient CNG Distribution Stations.


Industry Incentives:
Energy and power sector has significant investment incentives like:
1. Tax holiday for 15 years.
2. Tax exemption from interest payable on foreign loans.
3. Tax exemption from royalties, technical know-how and technical
assistance fees payable.
4. Tax exemption from profit arising from transfer of shares.

 

 
  Major Sector Highlights

A. Primary Commodities

Frozen food, Fish. Shrimps, Crabs , Sharkfins & fish maws, Fish-Dried, Salted & dehydrated, Animal casings, Agricultural products, Potato, Vegetables, Mustard oil, Betel nuts, Betel leaves, Aromatic Rice, Tobacco, Spices, Fruits, Tea (In packet/bulk), Crude/bio fertilizer, Raw jute, Cut flower, Biscuit, Dry food, Fruit juice, Jam/Jellies, Horns & hooves, Condensed milk, Animal bones, Mushrooms, Wood & timber etc.

B. Manufactured Commodities

Pharmaceuticals, Chemical fertilizer, Cosmetics, Molasses, Petroleum byproduct, Naphtha, Furnace oil, Bitumen, Chemical products, Glycerine, Cement, , P.V.C.bags, Bicycle, Accumulator battery & parts, Luggage & fashion goods, Corrugated carton, Polyester thread, Acrylic yarn, Padding/Interlining, Cotton bags, Particle board, Ceramic bricks, Umbrella, Cap, Aluminum household article, Wooden furniture, Ball pen, Mosquito net, Soap , Ceramic sanitary ware, Synthetic ropes, P.V.C pipe, Ceramic tiles, Hand gloves (Rubber), Glass sheet, Rayon yarn, Leather (Crust/finished), Jute goods (all sorts)Jute yarn & twine, Jute carpet, Jute manufactures, Handicrafts, Specialized textile & Household linen, Terry towel, Home textile, Knitwear, T-Shirts, Sweater, Shirts, Trousers, Jackets, G.I. pipe, Iron Chain, Cast Iron articles, Electric wires, Fishing reel, Telephone cables, Electric fan, Television set, Light fitting, Dry cell battery, Telephone set, Electronics Video/Audio cassette, Indicator lamp, Carbon rod, Circuit breaker, Computer accessories, M.S. rod, Copper wire, Computer services, Melamine tableware, Leather bags & purse, Printed materials, Textile fabrics, Cigarettes, Feature film, Jewellery, Jamdani sharee, Tents, Footwear (Leather)Footwear (Sports)Footwear (Jute), Camera parts, Hand gloves (Leather)Artificial flower, Ceramic tableware, Stainless steel ware, Generator, Transformer, Cotton yarn, Toys, Golf shaft, Silk fabrics etc.

 

 

 

 

 

 

 

 


     


  Finance and Economy  



  Message

 


  External Resources


 

 
 

Bangladesh High Commission
House no 114 , Jalan U-Thant
55000 Kuala Lumpur Malaysia.
Tel: +60342522652
+60342510364
+60342510893
Fax:
+60342510078 (Diplomatic Wing)
+60342510926 (Labour Wing)
+60342510569 (Defence Wing)
+60342510205 (Commercial Wing)
e-mail:bddoot@unifi.my

mission.kualalumpur@mofa.gov.bd



   

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